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GBP/USD Holds Gains

H.S. Borji
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GBP/USD Holds Gains

The GBPUSD was firmer Tuesday, as risk aversion in the global financial markets eased after Russian President Vladimir Putin said military activity in the Ukraine was not needed at this time.

The GBPUSD pair traded at a daily high of 1.6715, before falling to 1.6675 in North America’s afternoon session. This represented a gain of 11 pips. Cable is likely to find support at 1.6605, 1.6563 and 1.6522. On the upside, cable is likely to face resistance at 1.6705, 1.6747 and 1.6789.

In economic news, the British construction sector maintained its robust growth pace in February, led by rising output in civil engineering. Markit Group’s gauge of UK construction activity fell from January’s six-and-a-half year high, settling at 62.6. A broad consensus of economists forecast a reading of 63. Markit will report on UK services PMI Wednesday.

In the United States, economic data were less compelling. The Institute for Supply Management’s New York index fell from 64.4 to 57, representing the slowest rate of expansion since last summer. ISM will report on nationwide services PMI Wednesday.

The second half of the week features several high profile releases, which promise to keep forex traders speculating about monetary policy and US recovery. The Bank of England will coalesce Thursday to set monetary policy. No changes to the benchmark lending rate are expected. In the United States, the Labor Department will release official nonfarm payroll data for February. Labor is expected to announce a gain of 150,000 payrolls in February, according to preliminary estimates.

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